Judgment in PNR cases : Cases C-317/04 and C-318/04

The Court of Justice handed down its judgment in Joined Cases C-317/04 and C-318/04European Parliament v. Council and Commission. It held that the arrangements on the transfer of "passenger name records" of air passengers from the EC to the US Bureau of Customs and Border Protection were illegal and should be annulled.

As we noted earlier, Advocate General Léger recommended to the Court to do exactly that in his opinion of November 22nd 2005.

Case C-318/04 concerned the legality of Commission Decision 2004/535/EC on the adequate protection of personal data contained in the Passenger Name Record of air passengers transferred to the United States Bureau of Customs and Border Protection. The Court held that the Commission Decision was wrongly based on Directive 95/46/EC because the processing of the data put at the disposal of the United States concerned public security and the activities of the state in relation to criminal law and the fight against terrorism. Processing data for such purposes is outside the scope of the protection afforded by Directive 95/46/EC according to its Article 3 § 2. Consequently, the Commission could not lawfully adopt Decision 2004/535/EC on the basis of article 25 § 6 of Directive 95/46/EC. The Court reached that conclusion even though it noted that the data was initially collected by airlines, not governmental agencies. It held that the collection and transfer of the data by the airlines was required by law for reasons of public security unrelated to their provision of transport services to passengers.

Case C-317/04 was about whether Article 95 EC could serve as the legal basis for the adoption by the Council of Council Decision 2004/496/EC of May 17th, 2004 on the conclusion of an Agreement between the European Community and the United States of America on the processing and transfer of PNR data by Air Carriers to the United States Department of Homeland Security, Bureau of Customs and Border Protection. The Court simply held that, as in Case C-318/04, the processing of data for reasons of public security and in respect of the activities of the state in relation to criminal law and the fight against terrorism, Council Decision 2004/496/EC could not be lawfully based on Article 95 EC.

On reading the judgment, note three things.

First, the grounds of annulment are very narrow and the reasoning given is brief to the point of being terse. The European Parliament raised a whole series of pleas (on proportionality, breach of fundamental rights etc) which the Court of Justice did not examine. So it is difficult to guess what will be the next practical step taken by the Council and Commission.

Second, the Court, aware of the practical difficulties in relation to transatlantic flights that the annulment will cause has limited the effect of the annulment in time: The current arrangements can continue in force until September 30th 2006 by which time the Council and Commission must have taken steps to comply with the judgment. That's the date the arrangements between the EU and US expire anyway. As a result, there is no need to interrupt the transfer of the data to the US authorities with all the unfortunate consequences that would entail.

Third - and this is the really odd thing - the Court does not analyze Article 13 of the Directive.